CEO at Relevant

6 Best Practices to Overcome Cultural Differences in Offshore Software Development

November 3, 2021

Outsourcing software development has become quite widespread nowadays. The roots of its popularity are mainly in the labor cost differences between countries.
However, a different cost of labor does not automatically mean a different level of skills or expertise. Many companies have recognized this working arrangement as a way to achieve quality results at reduced cost.

Let’s look at what cultural differences are and how you can overcome or reduce them to create a comfortable working environment for everyone.
We hope these learnings will be useful both for startups or companies only planning to outsource their product development and to those who are already working with a distributed team and want to make collaboration more effective.

Current state of software development outsourcing

Currently, the geography of software development outsourcing is quite diverse. In addition to the cost factor, businesses now also consider the skills and professional qualities of the personnel in the countries they plan to outsource to.

Click on the following link, if you are interested in outsourcing rates by country.

According to the statistics, India was leading the ranking of top offshore outsource countries for its correlation of financial attractiveness and professional skills. However, as you can see from the diagram below, there are quite many other countries that can provide quality service at attractive cost.

Image credit: Statista

Besides the cost and skill factors, there is another important aspect that each business planning to outsource its product development should consider – cultural fit.
That is something that should never be ignored, as cultural differences may have their impact on such essential matters of product development as:

  • Subordination and reporting
  • Decision making
  • Task assignment
  • Definition of a completed task

Besides, inherent cultural differences may result in different views of the target audience or the visual components of your product. Therefore, cultural differences should be taken into account while planning offshore software development.

Software development outsourcing models

Depending on your project specifics, there may be different scenarios of your collaboration:

  • Outsourcing the entire product development with no in-house development team as such
  • Outsourcing a part of the product development while the in-house team does the majority of the development tasks
  • Engaging only developers with particular skills to extend the software development team and fill in the positions necessary for the current project

In the first case, you can expect the largest cost saving, as you need not provide any in-house development infrastructure. At the same time, you are getting an entire team that already has certain established rules and flows.

This may be an easy solution from the cultural point of view, as you do not need to worry about team-building and differences between team members.

If you are outsourcing only a part of your product development, for example, only graphic design, or getting several professionals for particular projects, you need to be more attentive to cultural differences if you invite people from other cultural communities.

Top 10 reasons why you should outsource to Ukraine.

In any case, there are certain best practices that we recommend to apply to achieve the maximum performance of your distributed team.

Best practices of outsourcing software product development

#1. Take into account the low-context or high-context culture aspects

This classification has very little to do with the skills or professionalism of your outsourcing development team, however, it can profoundly influence the overall style of communication and collaboration.

Simply put, low-context cultures rely on words and facts, while high-context ones place emphasis on emotions and trust. Other differences include:

Time and deadlinesVery importantLess important
Written commitmentsEncouraged and obeyedLess important, oral agreements have more value
Personal relationshipsNot encouraged and may interfere with workEncouraged and may influence business decisions
Working styleIndividualistic, task-orientedTeam-oriented, may be influenced by relationships
Attitude to changeWelcomingTraditional views and methods may prevail
Example countries:USA, Germany, Eastern EuropeChina, India
Low and high context cultures - 6 Best practices to overcome cultural differences in offshore software development
Image credit: ResearchGate

These are just a few of the most prominent differences between high-context and low-context cultures.
As you can see, those differences may affect the collaboration and create certain friction between team members. If you are choosing a team to do your product development or looking for professionals to extend your team, it will be wise to take these factors into consideration.

In all cases, start with introducing your company and its culture and values. That can clear a lot of issues already in the beginning and ensure much more complete understanding of the company’s goals. Similarly, try to see the cultural specifics of your offshore partners, especially those affecting communication.

#2. Select the appropriate development methodology

If you are only planning your collaboration with a remote team, this may be the best point of choosing the most optimal methodology taking into account the cultural differences.
In the countries of Asia, such as India, China or Malaysia, people respond better to well-defined tasks and strict processes.
For that reason, if you are assigning your project to an outsourcing software development company from one of those countries, think of applying the 
Waterfall methodology with clearly defined tasks at each stage and strict borders between project stages.

At the same time, Agile methodology with the project scope divided into sprints and the possibility of changes already during development is better suited for outsourcers from Latin America and Eastern Europe (Ukraine, Belarus).
Since the companies in the USA and Western Europe tend to use Agile development more often, for them, the recommended strategy may be looking for outsourcing agencies working according to the same principles as they do.

Besides, Agile works best when the team is physically located in the same place, as in this case, the daily meetings essential in Agile development can be the most convenient. However, with the availability of different remote collaboration tools, this becomes a minor issue.

For established businesses that have already adopted a particular development methodology, this consideration may be useful when looking for members to expand their existing teams.

#3. Establish regular communication

Effective communication is essential in any team, both in-house or remote. However, when outsourcing software development, proper communication becomes a key factor.

The first thing that comes to mind in the context of offshore outsourcing is the language. However, recently, this issue has become much less pronounced as the software development world mostly speaks English. At the same time, it is better to make sure that all members of your remote team speak English at an acceptable level so that you avoid possible misunderstandings.

Regular communication call - to overcome cultural differences in offshore software development

Establish a communication schedule and keep to it. When you hold regular meetings with your remote team, you can, on the one hand, control the performance much easier and, on the other hand, identify any issues or miscommunications early on.
If you are starting a project with an outsourcing team, work out a schedule that is acceptable for each team member. If you are bringing new offshore colleagues into your existing team, include them in the established schedule. Take into account different time zones, of course.

#4. Set clear goals

In a multicultural team, it is always important to clearly define the goals, priorities, and milestones. When goals are set and understood by all members of the team, it is much easier to achieve them and to monitor the progress. In this respect, application of the Agile methodology may be rather useful, as it allows breaking the whole project into smaller tasks and moving along by completing logical chunks of the functionality.

Together with defining the goals, establish the acceptance criteria and the quality standards. Always circulate them among all members of the team to avoid issues later.

If you are working with a full offshore team, they will have a team lead or a project manager on their side in most cases.
In such models, you will mostly communicate with the team lead who will be responsible for the team’s performance.

Of course, the cooperation with an offshore development company must be regulated with a contract clearly stating all duties, responsibilities, and penalties for both parties. Drawing such a contract will help to settle any issues should they arise.

#5. Test the collaboration before committing

When choosing a remote team to develop your product or enhancing your team with remote colleagues, start with small tasks that can help you see the quality and performance of your chosen partners. We recommend assigning a non-critical task to your new colleagues and, if you are satisfied with their work, move on to larger and more critical assignments.

If you are inviting remote developers to your existing team, good practice may be arranging a code review by your in-house team members.

#6. Plan and encourage offline meetings

No matter how effective remote collaboration may be, the value of offline meetings cannot be overestimated.
Especially at the beginning of your cooperation with an outsourcing company, it will be a very good idea to visit them on-site, to meet people face-to-face, to talk to them and to see them in their usual environment. This way, you can get a better idea of their working style and processes.

Offline meetings - to overcome cultural differences in offshore software development

When a remote colleague joins your team, try to work out a way to invite them to your team-building events or otherwise encourage offline communication.
This way, your offshore team members will feel included and better motivated.

If you opt for outsourcing your product development, you are getting multiple benefits of a dedicated development team model – the main one, of course, being the cost factor. However, collaborating with remote colleagues gives an excellent opportunity to meet people of other cultures, get a lacking industry or technology expertise, and leverage new approaches to the development process.

How to outsource development without any loss? Choose your partner wisely and always perform your side of the agreement.
Learn more about how to manage your remote development team effectively.

Written by
CEO at Relevant
My company has helped hundreds of companies scale engineering teams and build software products from scratch. Let's connect.

Success cases

Intended Future
Intended Future
View case
View case
Real Estate
USA, California
View case

Do you want a price estimate for your project?


Do you know that we helped 200+ companies build web/mobile apps and scale dev teams?

Let's talk about your engineering needs.

Write to us